Canada joins talks on pending U.S. auto tariffs

Monday July 30, 2018

Written by The Canadian Press

July 30, 2018 - Canada will join Mexico and other European and Asian auto-producing countries this week to plot strategy ahead of the potential imposition of tariffs on vehicles and auto parts exported to the United States.

Japan and the European Union organized the meeting for Tuesday in Geneva, where vice and deputy ministers from Canada, the EU, Japan and South Korea will gather to talk about the punishing levies threatened by U.S. President Donald Trump.

A Canadian government official told The Canadian Press on Sunday that deputy international trade minister Timothy Sargent would attend the meeting on Canada's behalf.

Trump has threatened to impose tariffs under Section 232 of the decades-old U.S. Trade Expansion Act. The legislation allows the president, under certain circumstances, to impose duties recommended by his commerce secretary under the notion that the goods being imported are a threat to national security.

Just as it did after the U.S. imposed hefty tariffs on steel and aluminum imports from Canada and other nations, the Trudeau government has said it would respond to auto tariffs with its own countermeasures.

The Canadian Automobile Dealers Association has warned that "dollar-for-dollar" retaliatory levies would have a much more significant effect on Canada's auto sector than counter-tariffs on aluminum and steel.

Critics warn the potential tariffs of up to 25 per cent, plus retaliatory measures, could add thousands of dollars to the price of a vehicle, kill jobs and cause significant harm to the global auto industry.

But auto parts makers have said Canada and other countries would have little choice but to respond in kind to any U.S. trade actions.

Trump ordered the Section 232 investigation of auto imports on May 23. It's not clear when the probe will be completed, although the one launched last year into steel and aluminum took several months to issue its conclusions.

While the Geneva meeting is only preliminary, it could lead to a co-ordinated response among auto-producing nations outside the U.S.

"The meeting is meant to bring together major auto-producing nations so we can discuss our concerns over the U.S. Department of Commerce's section 232 investigation of automobiles and parts,'' said the Canadian official, who was not authorized to speak publicly about the gathering.

Sargent was also scheduled to meet with World Trade Organization director general Roberto Azevedo Tuesday, according to the WTO's website.